Assortment By Peter Baskerville 4/07/2019
Product planning horizons H3 – Growth – Blue Ocean SALES H2 – Breakeven – Developed assortment/features H1 – Launch – Minimum Viable Product TIME
Product development Launch – MVP – the minimum acceptable features and assortment. Breakeven – Developed features & assortment – extensions of the MVP. Nothing too innovative Growth – Blue ocean – New products, new markets, innovations. Areas of no competition
Key product strategies A COST LEADERSHIP STRATEGY - good quality product or service at a lower cost than your competitors. A DIFFERENTIATION STRATEGY - perceived as being unique "throughout the industry". A FOCUS STRATEGY - a more 'intense' form of previous strategies - "focused" on a particular segment
% Goods + % Service = Product Ikea Clothing Cars Fast Food Fine Dining Education Lawn Mowing Service Goods
Total product approach Product bundle = Goods + Services + Benefits GOODS SERVICE SERVICE GOODS Delivery, warranty, repair, spare parts, instructions & training Glossy folder, reference material, instructions, certificates.
Agony of Choice
What are you really selling? What need are you really satisfying? “Lite ‘n easy’ sells meals, but they don't advertise meals. They advertise happiness & confidence.“ “In the factory we make cosmetics; in the store we sell hope” Charles Revlon - Revlon What need are you really satisfying?
What is a Café selling? Escape a stressful office Maintain or grow a relationship Do Reflective work Lonely time - connect A place to do business or reach agreement
We help our individual customers …. get more knowledge make or save money gain self esteem set themselves free to express their unique abilities, talents & expertise get more love to feel secure & safe to be better organised to fulfil their desires.
We help our business customers …. increase their revenue decrease their costs Increase profitability Improve productivity Improve time/speed cycle ensure satisfaction, retention & growth of their customers Improve the quality of their offer improve the satisfaction of their employees.
What products are you selling? Vitamins - a luxury Aspirin - nice-to-have Antibiotics - need-to-have
Profit squeeze determines strategy Threat of new competition Threat of substitute products or services Bargaining power of customers (buyers) Bargaining power of suppliers Intensity of competitive rivalry Easy market entry Big business – deep pockets Make it themselves Brand dominance Limited big purchase buyers
Profit squeeze by industry New Competition Online business Substitute Take-away food Customer Power Consumer goods - Coles Supplier power Fuel Intense rivalry Airlines